International Data Corp.has released a new update to its Worldwide Semiannual Blockchain Spending Guide where it predicts that annual global spending on blockchain solutions will reach $11.7 billion by 2022. It represents a five-year compound annual growth rate (CAGR) of 73.2%.
With current year global blockchain spending expected to stay at around $1.5 billion, the target of $11.7 billion over the next four years indicates a robust pace of growth for blockchain adoption at the global level across various industries. (See also: Can Blockchain Become the Global Standard?)
Finance Leads in Blockchain Adoption
The financial sector will lead blockchain spending during 2018, said the report. Its $552 million expenditure during 2018 will be largely driven by the banking industry.
The next biggest blockchain spender during 2018 comes from distribution and services sector, which will contribute $379 million, aided by investments from the retail and professional services industries. The manufacturing and resources sector, which is expected to invest $334 million in 2018, takes the next spot, which will see increased blockchain adoption from the discrete and process manufacturing industries. The highest growth rate is forecasted to be within the process manufacturing (78.8% CAGR), professional services (77.7% CAGR) and banking (74.7% CAGR).
The report further predicts that use cases for cross-border payments & settlements are expected to see the largest blockchain spending in 2018 ($193 million). It will be followed by lot/lineage provenance ($160 million), and trade finance & post-trade/transaction settlements ($148 million). The study predicts that these three use cases will continue to remain the largest in terms of overall spending in 2022.
Global Blockchain Adoption
Geographically, the United States is expected to lead the pack with more than 36% of global spending throughout the forecast period. It will be followed by the Western Europe, China, Asia/Pacific (excluding Japan and China) and the Middle East and Africa.
In terms of the highest growth rate, Japan and Canada will lead with CAGRs of 108.7% and 86.7%, respectively.
"Enthusiasm for blockchain continues to be universally shared across regions as businesses and organizations alike continue to explore the technology’s potential business application," said Stacey Soohoo, research manager with IDC's Customer Insights & Analysis team. "Regulatory concerns and industry standards continue to hinder widespread adoption as governments around the globe work with enterprises to formulate policies and governance. As such, cross-business collaboration and blockchain interoperability are emerging as key aspects in the growth of the distributed ledger technology." (See also: What's Stopping Blockchain from Mainstream Adoption?: Video.)